Judges: ARNOLD H. POLLOCK
Agency: Department of Business and Professional Regulation
Latest Update: Nov. 27, 1984
Summary: Applicant for alcoholic beverage license as charitable social club properly denied where evidence shows very little legitimate charitable activity.
84-0821STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
ATLANTIC SOCIAL CLUB, INC., )
)
Petitioner, )
)
vs. ) CASE NO. 84-0821
)
DEPARTMENT OF BUSINESS )
REGULATION, DIVISION OF ) ALCOHOLIC BEVERAGES AND TOBACCO, )
)
Respondent. )
)
RECOMMENDED ORDER
Pursuant to the Notice of Hearing furnished to the parties on March 22, 1984, as modified by a subsequent Order Granting Continuance, a hearing in this case was scheduled before Arnold H. Pollock, a Hearing Officer with the Division of Administrative Hearings in Miami, Florida, on October, 1981. However, counsel for both parties moved that the hearing be held, instead, upon documentary evidence and arguments in writing, and by Order dated October 1, 1984, that motion was granted. The issue for consideration here is whether Petitioner should be granted an alcoholic beverage license.
APPEARANCES
For Petitioner: George J. Tallianoff, Esquire
Office in the Grove
2699 South Bayshore Drive, Suite 600C Miami, Florida 33133
For Respondent: Thomas A. Klein, Esquire
Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301
BACKGROUND
On June 1, 1983, Petitioner, Atlantic Social Club, Inc. (Club), submitted an application for an 11-C alcoholic beverage license. This application was denied by the Respondent, Department of Business Regulation, Division of Alcoholic Beverages and Tobacco (DABT), on November 28, 1983 and Petitioner requested a hearing.
Petitioner submitted for the consideration of the Hearing Officer Petitioner's Exhibits A-D, and affidavits of Mathew Bothwell and Roosevelt Singletary. Respondent submitted the affidavits of Francisco Oliva and Leonard Delmonte and Respondent's Exhibits 1-13.
FINDINGS OF FACT
1. Petitioner, Atlantic Social Club, Inc., is a corporation organized under the laws of Florida on July 27, 1972. Its Articles of Incorporation, filed with the Secretary of State, reflect it is a corporation not for profit and its purpose is to be concerned with:
. . . the needy and underprivileged and to promote and be charitable to those in distress . . . .
Petitioner registered with the Florida Department of Revenue on May 31, 1983, and on June 1, 1983, filed an application with DABT for an 11-C alcoholic beverage license which may be issued to, inter alia, social clubs, nonprofit corporations, or clubs devoted to promoting community development, without limitation on the number of licenses issued in this category. Organizations, to qualify, must meet certain standards set out by rule and statute.
At the time of filing the application, Petitioner submitted several personal questionnaires executed under oath by the then corporate officers. The questionnaires signed by two officers, Elzie Lee Jackson and David Daniel Riles, indicated that they had never been arrested, charged, or convicted of any offense.
However, on April 12, 1977, Mr. Riles had been charged by the State Attorney in Miami, with, on February 12, 1977, carrying a concealed firearm (felony); possession of a firearm by an intoxicated person; and trespass after warning. Documentation submitted also reveals that on October 16, 1982, Mr. Jackson had been arrested at the Atlantic Social Club by state beverage officers for the sale of alcoholic beverages without a license. Neither individual is currently an officer, director, or member of the club.
Upon receipt of Petitioner's application, on June 29, 1983, Respondent, in writing, requested that Petitioner submit certain specified additional information necessary for investigation of the application. The information was to be submitted by July 23, 1983. The requested information consisted of a list of club members and a copy of its bylaws. In the interim, Investigator Oliva attempted, by telephone, to contact Mr. Riles to set up an appointment for an interview but could not reach him.
When the deadline for submitting the requested information had passed without compliance, Oliva met with Petitioner's representative, Mathew Bothwell, at Respondent's Miami office on July 25, 1983. At this time Bothwell provided the requested membership lists and bylaws as well as records of meetings.
At the meeting, Bothwell stated that Petitioner donated money to various charitable organizations, churches, and needy individuals. When asked for records of these donations, Bothwell indicated they did not normally exist but that he would try to provide them.
The documentation submitted by Petitioner for consider- ation of the Hearing Officer indicates charitable contributions on:
December 30, 1977 - Variety Children's Hospital $200.00
March 28, 1980 - Variety Children's Hospital $100.00
January 16, 1981 - Variety Children's Hospital $100.00
January 7, 1982 - Variety Children's Hospital $100.00
February 28, 1982 - New Jerusalem PBC
$200.00
Mr. Bothwell, by affidavit, also contends that the Club has continued to help the needy and unemployed by providing meals and foodstuffs but there is no evidence confirming this from even one recipient of this assistance.
Petitioner did produce other club records which included a copy of the bylaws dated July, 1983, the minutes of one meeting held on January 18, 1983, and a list of six members dated July 19, 1983. The bylaws are extremely limited and provide very little guidance for club operation. Certain provisions ordinarily required by rule, such as the method by which members are elected, are missing. Mr. Bothwell explained that the records of meetings, other than that submitted for January 18, 1983, were kept by the Club's secretary and were not available even though they had been requested by Respondent several weeks earlier.
At the close of the July 25, 1983 meeting between Oliva and Bothwell, Bothwell was informed that in order for the processing of the Club's application to progress, it would be necessary for Respondent to be furnished:
written minutes of all meetings;
accounting records, receipts, and other documentary proof of the Club's charitable activities; and
affidavits from Riles and Jackson indicating why they had failed to include their arrests on the personal questionnaires they submitted with the application.
These requested documents were not furnished to Respondent, but, on October 16, 1980, pursuant to the Order dated October 4, 1984, counsel for Petitioner submitted the membership records, documentary evidence of the $700.00 in contributions referenced above, and affidavits from Bothwell and Singletary to the effect that neither Riles, nor Jackson has any current affiliation with the organization.
The membership records provided, kept in a spiral notebook, which go no further than July 12, 1983, reflect 13 members. They also reflect that the 9 older members paid dues of $10.00 per week and in addition, paid money in for savings and dances. The earliest records on membership submitted were dated in January, 1981, and reflected activity from that time up to July 12, 1983. The Club's bank book, which, as of the last entry on May 31, 1983 showed a balance of $94.56, reflected a balance in October, 1982 of almost $6,400.00. No explanation was given for how this sum was disposed of.
When, on August 28, 1983, as a part of the ongoing investigation of the license application, Agents Oliva and Delmonte went to Petitioner's indicated address to get the information requested of Bothwell on July 25, they found both front and rear doors locked. Repeated knocking on all doors failed to get a response and it appeared as if the building was unoccupied.
As of the present date, Petitioner has failed to provide Respondent with its federal employer's identification number though it promised to do so in the past.
On November 28, 1983, Respondent denied Petitioner's application.
CONCLUSIONS OF LAW
Respondent denied Petitioner's application on several grounds. The first was that it was unable to fully investigate the applicant as is required by Section 561.18, Florida Statutes. This section provides in part:
After the application has been filed with the local district office supervisor, the district supervisor shall cause the application to be fully investigated, both as to qualifications of the applicants and a manager or person to be in charge and the premises and location sought to be licensed,
. . . .
It is obvious that if the agency, charged with the responsibility to investigate the applicant for a license for an operation in which the public has a legitimate interest, is hindered in its reasonable attempts to fulfill that responsibility by the actions of the applicant, it can legitimately reject the application for that reason.
Here, the Petitioner failed to keep adequate records and failed to establish its qualification to be a licensee under the statutory section in issue. When the agency requested additional information in support of the application, this information was not forthcoming, even so far as it was available, until filed by counsel with the undersigned. When Respondent's agents went to the Petitioner's facility to pick up the documents requested, they found it locked and were unable to obtain admittance. It is clear, therefore, that Respondent was unable to conduct a meaningful investigation as required by statute because of the lack of response by Petitioner.
Respondent also denied Petitioner's application, in part, because Jackson and Riles, both then officers of the Club, had falsely indicated on their sworn personal questionnaires submitted with the application that they had never been arrested.
Section 5590.791, Florida Statutes, provides in part: Any license issued by the Department of
Business Regulation which is issued or renewed in response to an application upon which the person signing under oath or affirmation has falsely sworn to a material statement, including, but not limited to, the names and addresses of the owners or managers of the licensee or applicant, shall be subject to denial of the application or suspension or revocation of the license,. . .
Here, two of the officers of the association made false statements under oath to the effect that they had not been arrested when, in fact, both had and knew it. An arrest, especially for a felony, is a material fact, and it can hardly be said that an arrest for doing unlawfully, without a license, what the license would permit, is not material to the issue of the qualifications of the applicant to be licensed. The fact that both individuals are no longer officers or directors of the organization, or, for that matter, even members, is immaterial.
The third basis for denial was that the applicant corporation did not qualify for an 11-C license under Section 565.02, Florida Statutes,, because it had failed to document the charitable basis of the organization and failed to show it had operated as such for no less than two years. This section requires that to be licensed as here, bona fide clubs:
. . . shall have been in continuous existence in operation for a period of not less than two (2) years in the county where they exist.
The Atlantic Social Club, Inc. was incorporated in 1972 and, at least since January 4, 1981, according to the incomplete financial records provided, has operated as such collecting dues at the rate of $10.00 per week per member, in addition to other assessments. Membership fluctuated in numbers from 13 to 6, but it appears the operation continued without interruption for at least the two years prior to the application. Further, the statute does not require but permits incorporations by a judge as an alternative to incorporation with the Secretary of State. Consequently, it would appear that Petitioner corporation does constitute a social club and the Articles of Incorporation reflect its purpose to be charitable in nature.
However, as is stated as the fourth ground for denial, there is little showing that the organization actively pursued the charitable purposes stated in the charter. The evidence submitted by counsel in the form of receipts from the Variety Children's Hospital and the New Jerusalem Primitive Baptist Church shows that on only 5 separate occasions since 1977, the Club donated a total of
$700.00 to charity. Mr. Bothwell urges that other donations were made on an individual basis but no independent evidence to confirm this was introduced. This is most significant in view of the more than $6,000.00 which was accumulated in the Club's treasury as of October, 1982. In light of these factors, it is clear that the Petitioner was a private club, but it certainly did not actively pursue the charitable purposes listed in its Articles of Incorporation.
Section 561.20(7)(a)3, Florida Statutes, permits the issuance, without limitation, of liquor licenses to private clubs which meet certain requirements. The criteria discussed above set out these requirements and it is obvious that in a substantial way, Petitioner fails to meet them.
RECOMMENDATION
Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore:
RECOMMENDED that the application of the Petitioner, Atlantic Social Club, Inc., for an 11-C alcoholic beverage license be DENIED.
RECOMMENDED this 27th day of November, 1984, in Tallahassee, Florida.
ARNOLD H. POLLOCK
Hearing Officer
Division of Administrative Hearings 2009 Apalachee Parkway
Tallahassee, Florida 32301
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 27th day of November, 1984.
COPIES FURNISHED:
William A. Hatch, Esquire Department of Business
Regulation
725 South Bronough Street Tallahassee, Florida 32301
George J. Tallianoff, Esquire Suite 600C, Office in the Grove 2699 South Bayshore Drive Miami, Florida 33133
Captain John J. Harris Department of Business
Regulation
1350 Northwest 12th Avenue, Room 552
Miami, Florida 33136
Gary R. Rutledge, Secretary Department of Business
Regulation
725 South Bronough Street Tallahassee, Florida 32301
Howard M. Rassmussen, Director Department of Business
Regulation
Division of Alcoholic Beverages and Tobacco
725 South Bronough Street Tallahassee, Florida 32301
Docket for Case No: 84-000821
Orders for Case No: 84-000821
| Issue Date |
Document |
Summary |
|
Nov. 27, 1984 |
Recommended Order
|
Applicant for alcoholic beverage license as charitable social club properly denied where evidence shows very little legitimate charitable activity.
|
